Data shows the crypto market sentiment has improved from a state of extreme fear, but still remains quite close to re-entering the zone.
Crypto Fear And Greed Index Points To A Fearful Market
The “fear and greed index” is an indicator that tells us about the general sentiment among investors in the cryptocurrency market.
The metric uses a numeric scale that runs from zero to hundred for displaying this sentiment. When the value of the index is below fifty, it means the market is fearful right now.
On the other hand, values of the indicator higher than the threshold suggest a dominant sentiment of greed among crypto investors.
Values of above 75 and below 25 (that is, those towards the ends of the range) indicate sentiments of “extreme greed” and “extreme fear,” respectively.
The extreme sentiments have been historically significant for coins like Bitcoin as tops have usually taken place in the former periods, while bottoms have occurred in the latter ones.
Now, here is a chart from this week’s Arcane Research report that shows the trend in the value of the fear and greed index over the past year:
The value of the metric seems to have surged up in recent days | Source: Arcane Research's The Week Onchain - Week 36, 2022
As you can see in the above graph, the crypto fear and greed index fell into extreme fear values just sometime ago.
Recently, however, the investor mentality in the market marked an improvement as the indicator reached a value of 34 a couple of days back, at the time the report came out.
This is a significant jump over the extreme fear territory, but it’s also two days old. Yesterday, as an effect of the Bitcoin price dropping, the index also saw a plunge and reached a value of just 27.
Today isn’t any different; the metric’s latest value is 28, only three units away from the bottom sentiment region.
The market continues to observe fear | Source: Alternative
The report notes that the index still showing fear suggests investors don’t believe the seemingly endless bear market is over just yet.
BTC Price
At the time of writing, Bitcoin’s price floats around $20.1k, up 5% in the last seven days. Over the past month, the crypto has lost 17% in value.
The below chart shows the trend in the price of the coin over the last five days.
Looks like the value of the crypto has observed sideways movement following the plunge a few days back | Source: BTCUSD on TradingView
Featured image from Traxer on Unsplash.com, charts from TradingView.com, Arcane Research
